On FHA projects closing on or after 27 January 2017 relief is on its way. Looks like the new rate is .55% versus the old .85%. That means if you were paying $500 per month as an example your client now will pay only about $324, so they will have an additional $176 to use for the actual house payment.
If the client is putting a 10% down payment the PMI drops to .25%
The upfront MIP is still 1.75% and is still fanciable.
To see the entire ML 17-01 click here.
PMI has always been confusing to many potential buyers. It isn't insuring them but they aer paying for it. They are buying insurance to pay FHA, in this case, the remaining mortgage amount should they default. $300-500 monthly payments are being made by the borrower to insure FHA they will pay that loan off.